An inexperienced accountant for Stahr Company made the following errors in recor

Question

An inexperienced accountant for Stahr Company made the following errors in recording merchandising transactions.

Prepare separate correcting entries for each error, assuming that the incorrect entry is not reversed.

. A $300 refund to a customer for faulty merchandise was debited to Sales Revenue $300 and credited to Cash $300. 2. A $301 credit purchase of supplies was debited to Inventory $301 and credited to Cash $301. 3. A $180 sales discount was debited to Sales Revenue. 4. A cash payment of $21 for freight on merchandise purchases was debited to Freight-Out $210 and credited to Cash $210.

Explanation / Answer

Journal entries are as follows:

1. Sales return and allowance debit 300

Sales revenue credit 300

2.supplies debit 301

Cash debit 301

Account s payable credit 301

Inventory credit 301

3 sales discount debit 180

Sales revenue credit 180

4.Inventory debit 21

Cash debit 189

Freight out credit 210

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